Increased Gold/Silver Production Results, Mexico
VANE Minerals plc (AIM:VML)("VANE" or the "Company")
Joint Venture Agreement
Increased Gold/Silver Production Results, Mexico
Highlights
· 24.6% increase SDA mill throughput and increase in gold/silver mill head grades through mining and milling of JV ore:
o 10,930 tonnes throughput, 2.81 g Au/t, 136gAg/T compared with 8,773 tonnes, 2.2 gAu/t, 195 gAg/T for September- December 2010 period
· all gold/silver sold unhedged
· new areas identified for higher grade mining
· construction underway on a cyanide batch leaching and Merrill-Crowe recovery facility at the
SDA Mill: expected by the Board to increase revenue following commissioning in Q2, 2011
· Results govern period 1 January - 30 April 2011
VANE today announces higher grade gold/silver production as a result of the Joint Venture ("JV") the Company formed with the Ruiz Brothers ("Ruiz") in the La Rastra during June of 2010. The results are the first that report the recovery progress from switching feedstock from solely VANE's wholly owned Diablito mine to combining areas owned and mined by Ruiz.
The JV has worked to optimise mining processes across the 172.3 hectares governed by the agreement. The Board of VANE is encouraged by the results for the four month period and anticipates that the Company is on track to achieve its production targets for the 2011 calendar year. Feedstock and recovery results at our San Dieguito de Arriba mill ("SDA Mill") for the period are as follows:
|
Month |
Throughput tonnes |
% Au/Ag recovery |
oz Au/Ag recovered |
|
Jan |
2,769 |
80.5/78.6 |
136/11,471 |
|
Feb |
2,579 |
55.7/51.7 |
130/5,508 |
|
March |
3,001 |
73.1/74.6 |
110/10,370 |
|
April
Total (Jan-April 2011) |
2,581
10,930 |
64.5/55.8
68.8/65.8 |
276/4,862
652/32,863 |
|
Total (Sept-Dec 2010) |
8,773 |
73.0/73.0 |
457/40,156 |
|
|
|
|
|
The area covered by the JV is located in the southern part of the State of Sinaloa, Mexico, approximately 117 km north of the SDA Mill and includes an area of interest of approximately 1,500 square kilometers. Ruiz are responsible for primary mining and transport of the ore from the mines to the SDA Mill. Under the terms of the JV, net profits generated by the JV mines are split on an 80:20 basis in VANE's favour until such time as VANE has recovered 150% of any outlaid development/capital costs incurred by it in connection.
Commenting today, Steve Van Nort, CEO of VANE said: "We are extremely pleased with these first results from our decision to process higher grade ore from the JV area surrounding our SDA mill as the Diablito mine nears the end of its life. I feel we have now secured an important new cash generator through the JV agreement with more production potential than at the single Diablito mine. Our intention is to use funds from our Mexican operations to drive our exploration portfolio in the United States. "
Kristopher K. Hefton, Chief Operating Officer VANE Minerals (US) LLC, BSc Geology, who meets the criteria of a qualified person under the AIM Rules - Guidance for Mining, Oil and Gas Companies, has reviewed and approved the technical information contained within this announcement.
For further information, please contact:
|
VANE Minerals Plc |
+44 (0) 20 7667 6322 |
|
Matthew Idiens Allenby Capital Brian Stockbridge/Alex Price
|
+44 (0) 203328 5656
|
|
Threadneedle Communications |
+44 (0) 20 7653 9850 |
Laurence Read/ Graham Herring
Further detail on the agreement with the Ruiz brothers and exploration potential
The JV's initial focus is on four concessions currently controlled by the Ruiz brothers, of which, La Colorada, is currently in production. In addition, exploration and mine planning of the additional concessions will be examined.
Within the four concessions, a number of precious metal veins and vein systems are known and have been partially developed:
· La Colorada concession (14 hectares) - includes the following workings: Salto, La Camichin,
Campo Ancho, La Colorada, and La Escondida workings located at different elevations along the same vein(s) system. These workings have opened the principal vein structure intermittently over a horizontal distance of 400 meters and a vertical distance of 130 meters;
· Maria Fernanda concession (72 hectares) - includes two separate veins, Saltito, which has
numerous shallow workings along a strike length of more than 500 meters and the largely unexplored Papayal vei;.
· Jorge Luis concession (11.9 hectares) - covers the upper level workings along the La
Valenzuela vein 75 meters above La Valenzuela tunnel; and
· La Valenzuela concession (74.9 hectares) - adit provides access to the lower level as well as the upper workings along the La Valenzuela vein.
Although several ore shoots have been intersected in the La Colorada drift, current production is from a 2-meter wide vein which extends upwards to the La Escondida drift, 15 meters above. The Board believes that the potential below the La Colorada drift is encouraging based on historic drill results obtained in 2006. Sampling of the La Colorada drift indicates another ore shoot which has yet to be fully explored or mined but which would be accessible by advancing the lowermost Salto tunnel 200 meters to the north along the La Colorada vein. Mapping and sampling will be carried out by the JV to determine the location of all of the underground workings and the best method to access the known ore shoots to expand production. Diamond drilling will be carried out by the JV as necessary.
The Saltito vein system, which is the JV's next target for production, on the Maria Fernanda concession, exhibits numerous shallow mine workings over a 500+ meter strike length. Historic drilling (2006) has given indications of mineralization extending to depth. Mineralogy and grades are projected to be similar to the ore being produced at La Colorada. The JV will carry out mapping and sampling to determine the best method of accessing and developing the ore shoots currently indicated from shallow underground workings along with diamond drilling as necessary.
Historic mapping from the La Valenzuela vein indicates two ore shoots extending from the upper Jorge Luis drift to 40 meters below the La Valenzuela drift, a vertical difference of 115 meters in which a non-compliant NI43-101 resource of 43,000 tonnes at 6.8 g/T Au (9,400 oz. Au) and unspecified silver has been inferred. Mapping and sampling will be carried out by the JV to determine the best method of accessing and developing the ore shoots currently indicated from the underground workings along with Diamond drilling as necessary.
Within the 1,500 km2 area covered by the JV numerous other precious metal vein targets exist as per the "Geological-Mining Monograph of the State of Sinaloa" published by the Consejo de Resursos Minerales and the Board anticipates that these will be explored and evaluated in the course of the JV. VANE's and the Ruiz brothers' intention is to develop several additional projects that will be capable of each supplying 50+ tonnes of ore/day which, the Board believes, would in turn justify the construction of an additional mill in a location more central to the mines. Concentrates from that mill would then be processed by leaching and Merrill Crowe precipitation at the SDA Mill.
This information is provided by RNS
Latest directors dealings
- 1 day ago Savannah Energy
- 1 day ago Buccaneer Energy PLC
- 1 day ago Savannah Energy
- 1 day ago Carclo
- 1 day ago Schroder Japan Growth Fund